U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                   FORM 10-KSB

                      Annual Report Pursuant to Section 13
                 or 15(d) of the Securities Exchange Act of 1934

                   For the Fiscal Year Ended December 31, 1999

                           Commission File No. 0-12968

                        INMEDICA DEVELOPMENT CORPORATION

           Utah                                          87-0397815
------------------------                       -----------------------------
(State of Incorporation)                    (I.R.S. Employer Identification No.)

                                                 825 North 300 West

                   Salt Lake City,  Utah 84103
                         (801) 521-9300

Securities Registered Pursuant to Section 12(g) of the Act:

                                                   Name of Each Exchange
Title of Each Class                                 on which Registered
-------------------                                 -------------------
Common Stock, $.001 par value                              None

Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or Section  15(d) of the Exchange Act during the past 12 months,  and (2) has
been subject to such filing requirements for the past 90 days. [X] yes  [ ] no

Check if there is no disclosure of delinquent  filers in response to Item 405 of
Regulation SB contained in this form, and no disclosures  will be contained,  to
the best of  registrant's  knowledge,  in any  definitive  proxy or  information
statement  incorporated  by  reference  in Part III of this  Form  10-KSB or any
amendments to this Form 10-KSB [X]

Issuer's revenues for its most recent fiscal year: $ 105,480

The  aggregate  market  value  of  voting  stock  held by  nonaffiliates  of the
registrant as of March 22, 2000 was approximately  $2,221,129.(1)  The number of
shares  outstanding of the issuer's  common stock,  $.001 par value, as of March
20, 2000 was 8,735,899.

DOCUMENTS INCORPORATED BY REFERENCE: None

(1) Based on  4,963,417  non-affiliate  shares at $.45 per share,  which was the
average of the bid and asked price on that date.


                                       1
<PAGE>






Item 1. Business  General.  InMedica  Development  Corporation  ("InMedica") was
incorporated  as a Utah  corporation  on June 16,  1983.  During  the last three
fiscal years, InMedica's primary activity has been the operation of the business
of MicroCor, Inc. ("MicroCor"), a wholly owned subsidiary. MicroCor was acquired
effective December 31, 1985.  MicroCor has engaged in the development or sale of
certain  medical  technology  products.  However,  royalty  income  received  by
MicroCor from the development and sale of technology pursuant to a contract with
Johnson & Johnson Medical, Inc. is now minimal (See "Results of Operations") and
Johnson & Johnson  Medical,  Inc. is phasing  out the product  line on which the
royalty is paid.

     Effective December 1, 1999 InMedica appointed Ralph Henson to replace Larry
E. Clark as President  and Chief  Executive  Officer of the  Company.  Mr. Clark
continued as Chairman of the Board. In connection  with the change,  the Company
entered an employment  contract with Mr.  Henson,  agreeing to pay him $5,833.33
per month for a period of six months.  If the Company is  successful  in raising
$150,000 in capital, then the employment agreement  automatically extends for an
additional six months. In addition,  the Company issued Mr. Henson 75,000 shares
of  restricted  common  stock,  effective  December  1, 1999 and Larry E.  Clark
transferred  an  additional  25,000  shares of  restricted  common  stock to Mr.
Hensen.  InMedica  also  agreed  to pay Mr.  Henson  a bonus  of 1.5% of the net
acquisition price of the Company in any acquisition or 2.5% of the net amount of
any capital raised during the six months following the date of the agreement. In
connection  with the  foregoing  transactions,  Mr. Henson was appointed to be a
member  of the Board of  Directors  of the  Company.  John  Merendino  and David
Dingman resigned as Directors of the Company in November, 1999.

     Preferred Stock. See Note 5 to the  Consolidated  Financial  Statements for
information  regarding the preferred stock of the Company.  The Company has five
preferred  stockholders  holding an aggregate  of 25,356  shares of the Series A
Preferred  Stock  which is 8%  cumulative  convertible  preferred  stock.  Total
aggregate  dividends  payable on the preferred  stock  outstanding is $9,128 per
year.




                                       2
<PAGE>





     Principal  Products.  During the years 1986 and 1987,  MicroCor  developed,
manufactured and marketed a portable  electrocardiograph  ("ECG") monitor. About
450 units were  manufactured and sold. In July 1989,  MicroCor signed a research
and  development  contract  with  Critikon  (predecessor  to  Johnson  & Johnson
Medical,  Inc.) to develop a medical  instrument  which  would  incorporate  and
enhance the technologies  already developed in the MicroCor portable ECG monitor
and combine  them with  technologies  developed  by  Critikon.  The research and
development  portion of the contract was completed in July 1990, and resulted in
the design of a new product line. The product line was successfully  marketed by
Johnson & Johnson Medical,  Inc. during the 1990's,  providing royalty income to
InMedica,  but the product line is now being phased out and the Company does not
expect the royalty income to extend past the year 2000.

     Product  Development.  For the past 10 years,  the  Company  has  conducted
research  or engaged in fund  raising  to  support  development  of a method for
measuring hematocrit  non-invasively (without drawing blood) and has applied for
patents covering this  technology.  Hematocrit is the percentage of blood volume
made up by red blood cells and is a common  laboratory test currently  performed
invasively by drawing a blood sample from the patient.  For several  years,  the
Company conducted research and development in-house,  under the direction of Dr.
Allan  Kaminsky,  former  president  of the Company.  Subsequently,  the Company
engaged outside  consultants to work on the project  including Paul W. Ruben and
the Northern Ireland Bio-Engineering Centre.

     During May 1997,  the Company  employed Dr. Gail  Billings,  a  bio-medical
researcher and,  effective August 29, 1997, the Company engaged Medical Physics,
Inc., a biomedical  research  company located in Salt Lake City, Utah to conduct
further  research and  development on the project.  The  researchers  engaged in
additional research through 1998.

     During  1999,  the  researchers  completed  production  of a  transportable
prototype  device for use in  demonstrating  the technology.  During the current
year,  the company  plans to use the  prototype  and its  intellectual  property
rights in an attempt to secure additional funding through direct investment,  or
to enter into  development,  distribution or licensing  agreements with industry
partners for the development of the  technology,  although it has no commitments
at the present time.

     Government Regulation. Medical products may be subject to regulation by the
Food and Drug  Administration (the "FDA") pursuant to the Federal Food, Drug and
Cosmetic  Act and  other  federal  and  state  laws  regarding  the  regulation,
manufacture  and  marketing of products in which  InMedica may be involved.  The
laws of foreign  nations may also apply to any  international  marketing of such
products.  To the extent  InMedica  has  acquired  or  developed  an interest in
medical  products  or the  companies  manufacturing  such  products,  InMedica's
business may be indirectly affected by such regulation. Testing of the Company's
non-invasive  hematocrit technology is subject to prior approval and supervision
of an  Internal  Review  Board of a medical  facility  overseeing  the  testing.
Marketing  of any new  product  line  which  might  be  developed  based  on the
Company's  non-invasive  hematocrit device would be subject to prior approval by
the FDA.





                                       3
<PAGE>






     Patents.  As of December 12, 1995, the Company's  application  for a patent
entitled "Method and Apparatus for Non-Invasively  Determining  Hematocrit," was
allowed by the U.S.  Patent Office and the Patent issued on June 18, 1996 with a
term of 17 years. The Company has filed an application for an additional  patent
which claims  priority from October 4, 1990, the date of filing of the Company's
"Method and Apparatus for  Non-Invasively  Determining  Hematocrit".  The second
patent has been allowed and is expected to issue in due course.  The patent term
is expected to run from October 4, 1990 for a period of 17 years. As of December
21, 1999,  the Company  received a first office  action notice of allowance on a
third  patent  "System  and  Method  for  Invivo  Hematocrit  Measurement  Using
Impedence and Pressure Plethysmography."

     Raw Materials.  Materials and electronic  components used in the production
and  development  of ECG  monitors  and like  products  are  components  readily
available through various suppliers.

     Competition.  InMedica is not presently a significant factor in the medical
products  industry  and does  not  presently  compete  directly  in the  medical
products  field.  The medical  products  industry is dominated by large and well
established  corporations with vastly greater financial and personnel  resources
than  those of  InMedica.  There  can be no  assurance  that the  companies  and
products in which InMedica has an interest will be able to compete profitably in
the marketplace. Further, there is no assurance that the Company will be able to
complete  research,  development  and marketing of its hematocrit  technology in
advance of any competitors who may be developing competing technologies.

     Research and Development Costs.  Research and development costs for the two
years ended December 31, 1999 and 1998, were $66,818 and $224,618, respectively.
None of the expenses were  incurred on  customer-sponsored  research  activities
relating to the development of new products.

     Employees.  InMedica  and  MicroCor  had one full  time  and two part  time
employees as of December 31, 1999.


Item 2.  Properties
         ----------

     Office. The Company presently uses facilities  provided by Medical Physics,
Inc., at no cost, for its offices.


Item 3.  Legal Proceedings
         -----------------

     There are not any pending legal  proceedings.  Information as to previously
threatened legal proceeding follows;





                                       4
<PAGE>




     During the third quarter of 1996, a former officer of the Company, Allan L.
Kaminsky, threatened to bring legal proceedings affecting the Company or a proxy
contest to obtain  control of the  Company.  Among other  things,  Dr.  Kaminsky
objected to the number of options issued to officers,  directors,  employees and
consultants  of the Company.  At a board meeting held July 31, 1996, the Company
voluntarily  reduced  the  number of options  by 25%  effective  August 1, 1996,
reducing the total  options  granted from  1,100,000  to 825,000.  Dr.  Kaminsky
thereafter  offered to continue to be associated with the Company on terms which
were subsequently rejected by the Board of Directors after due consideration. On
September 17, 1996, Dr. Kaminsky advised the Company that his offer to negotiate
had  expired,  that he had no further  association  (employment,  consulting  or
advisory) with  InMedica/MicroCor,  other than being a passive  shareholder  and
that his action was permanent and irreversible.

     At the Company's annual  shareholder  meeting held August 29, 1997, Company
personnel advised the shareholders that they believed notice of meeting had been
inadequate  due to  inadvertent  failure to mail notice to beneficial  owners of
stock held in street  name,  although  there  appeared to be  sufficient  shares
present to  constitute  a quorum and ballots were  accepted at the meeting.  The
following  week the Company mailed a letter to  shareholders  advising them that
the meeting would be rescheduled.

     Following the mailing,  Dr. Kaminsky demanded through his attorney that the
Company  disclose  the results of the tallies of the August 29, 1997 ballots and
proxies  under threat of  litigation.  He also claimed the meeting was valid and
that  proper  notice had been given.  After  reviewing  the matter,  the Company
disclosed the results of the meeting and concluded  that the incumbent  Board of
Directors  had been  re-elected  at the  meeting  by a  plurality  of the shares
present and voting at the  meeting.  Dr.  Kaminsky  continues  to be a principal
shareholder of the Company (see "Security Ownership of Certain Beneficial Owners
and Management").

Item 4.  Submission of Matters to a Vote of Security Holders
         ---------------------------------------------------

     There were no  matters  submitted  during the fourth  quarter of the fiscal
year covered by this report to a vote of security holders.




                                       5
<PAGE>





                            PART II

Item 5.  Market for the  Registrant's  Common Stock and Related  Security Holder
--------------------------------------------------------------------------------
Matters.
--------

         (a)  Price Range of Common Stock.
              ---------------------------

         The Common Stock of InMedica is traded in the  over-the-counter  market
and is quoted on the "NASD OTC Bulletin Board".  The following table sets forth,
for the calendar quarters indicated, the high and low closing bid prices for the
InMedica  Common  Stock  as  reported  by the  NASD OTC  Bulletin  Board.  These
quotations  represent  prices  between  dealers  without  adjustment  for retail
markups, markdowns or commissions and may not represent actual transactions.

                                           Bid Price
         Quarter Ended                   High       Low
         -------------                   ----       ---

March 31, 1998                         $  .72     $ .25
June 30, 1998                            1.00       .56
September 30, 1998                        .75       .31
December 31, 1998                         .44       .22

March 31, 1999                         $  .34     $ .28
June 30, 1999                             .81       .28
September 30, 1999                        .35       .19
December 31, 1999                         .34       .21


         As of March 20, 2000,  there were  approximately  510 record holders of
InMedica   Common  Stock.   Such  record  holders  do  not  include   individual
participants in securities position listings.  The Company also has five holders
of its  Series A  Preferred  Stock.  There is no public  market for the Series A
Preferred Stock (see "Preferred Stock").

         InMedica  has not paid any cash  dividends  on its Common  Stock  since
organization.  For the foreseeable  future,  InMedica expects that earnings,  if
any,  will be retained for use in the business or be used to retire  obligations
of the Company.  For information as to the Company's obligation to pay dividends
on Preferred Stock, see "Preferred Stock."


                                       6
<PAGE>


Item 6.  Management's Discussion and Analysis of Financial Condition and Results
--------------------------------------------------------------------------------
of Operations.
--------------

    Liquidity and Capital Resources

         For the years ended December 31, 1999 and 1998, liquidity was generated
primarily  from royalty  income  received from Johnson & Johnson  Medical,  Inc.
("JJMI") and borrowing from affiliates. This income source is not expected to be
sufficient to provide future liquidity needs,  retire debt when it comes due and
fund continued  research and development.  InMedica  continues to look for other
funding sources, however to date it has no commitments.

         The Company's  royalty  agreement  with JJMI has been pledged to secure
repayment of the $145,000 debt owed to the Company's Chairman. Funds invested to
develop the  hematocrit  device have been expensed as research and  development.

         However,  the Company plans to use the  transportable  prototype device
and its intellectual  property rights to search for additional  funding through
direct investment or through  development,  distribution or licensing agreements
with industry partners, although it has no commitments at the present time.

    Results of Operations

         InMedica  incurred  net  losses in 1998 and 1999.  The  Company  had an
accumulated deficit of $7,230,268 as of December 31, 1999.

         Operating  revenues  have been derived only from  royalties  during the
two-year  period ended  December 31, 1999.  During the years ended  December 31,
1999 and 1998 royalty revenue totaled $105,480 and $247,400, respectively.

         The net loss of $140,414 for the year ended  December 31, 1999 compared
to the net  loss of  $241,188  for  1998,  resulted  primarily  from a  $141,920
decrease in royalty revenues. However, during 1999, the Company met its research
and development and administrative  expenditure requirements from existing cash,
loan  proceeds,  royalty  receipts  and  the  issuance  of  stock.  General  and
administrative  expense and research and  development  expense  decreased as the
Company restricted expenditures due to restricted cash flow.




                                       7
<PAGE>





Item 7.     Financial Statements               Beginning at Page
            --------------------               -----------------

    Report of Independent Public Accountants             F-1

    Consolidated Balance Sheet as of December 31, 1999   F-2

    Consolidated Statements of Operations for the
    years ended December 31, 1999 and 1998               F-3

    Consolidated Statements of Stockholders' Deficit
    for the years ended December 31, 1999 and 1998       F-4

    Consolidated Statements of Cash Flows for the
    years ended December 31, 1999 and 1998               F-5

    Notes to Consolidated Financial Statements           F-7




                                       8
<PAGE>
                        INMEDICA DEVELOPMENT CORPORATION

                       CONSOLIDATED FINANCIAL STATEMENTS
                            AS OF DECEMBER 31, 1999
                            AND FOR THE YEARS ENDED
                           DECEMBER 31, 1999 AND 1998

                            TOGETHER WITH REPORT OF
                         INDEPENDENT PUBLIC ACCOUNTANTS



<PAGE>



                    REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS

To InMedica Development Corporation:

We  have  audited  the  accompanying  consolidated  balance  sheet  of  InMedica
Development  Corporation (a Utah  corporation) and subsidiary as of December 31,
1999,  and the related  consolidated  statements  of  operations,  stockholders'
deficit and cash flows for the years  ended  December  31, 1999 and 1998.  These
financial  statements are the  responsibility of the Company's  management.  Our
responsibility  is to express an opinion on these financial  statements based on
our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable  assurance about whether the financial  statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting  the amounts and  disclosures in the financial  statements.  An audit
also includes assessing the accounting principles used and significant estimates
made by  management,  as well as  evaluating  the  overall  financial  statement
presentation.  We believe  that our audits  provide a  reasonable  basis for our
opinion.

In our opinion,  the financial  statements  referred to above present fairly, in
all  material  respects,   the  financial   position  of  InMedica   Development
Corporation  and  subsidiary  as of December 31, 1999,  and the results of their
operations  and their cash flows for the years ended  December 31, 1999 and 1998
in  conformity  with  accounting  principles  generally  accepted  in the United
States.

The accompanying  consolidated  financial statements have been prepared assuming
that the Company will continue as a going concern. As discussed in Note 1 to the
consolidated  financial statements,  the Company suffered net losses of $140,414
and $241,188 during 1999 and 1998,  respectively,  and there can be no assurance
of  profitability  in the  future.  The  Company's  sole  source of revenue is a
royalty  arrangement  and the Company has been  notified  that the royalties are
expected to  terminate  in 2000.  As of December  31,  1999,  the Company had an
accumulated  deficit of  $7,230,268,  a  stockholders'  deficit of $240,395  and
negative working capital of $243,297.  These conditions raise  substantial doubt
about the Company's ability to continue as a going concern.  Management's  plans
in  regard  to these  matters  also are  discussed  in Note 1. The  consolidated
financial   statements   do  not  include  any   adjustments   relating  to  the
recoverability  and  classification  of asset carrying amounts or the amount and
classification  of liabilities that might result should the Company be unable to
continue as a going concern.

By:/s/Arthur Andersen LLP
-------------------------
ARTHUR ANDERSEN LLP



Salt Lake City, Utah
  March 9, 2000

                                       F-1

<PAGE>



                 INMEDICA DEVELOPMENT CORPORATION AND SUBSIDIARY

                           CONSOLIDATED BALANCE SHEET
                             AS OF DECEMBER 31, 1999

                                     ASSETS

CURRENT ASSETS:
   Cash                                                       $      --
   Royalties receivable                                            57,120
   Prepaid expenses and other                                      16,051
                                                              -----------
                Total current assets                               73,171

EQUIPMENT AND FURNITURE, at cost,
  less accumulated depreciation of
  $252,283                                                            706

OTHER ASSETS                                                        2,196
                                                              -----------

                Total assets                                  $    76,073
                                                              ===========

                     LIABILITIES AND STOCKHOLDERS' DEFICIT

CURRENT LIABILITIES:
   Notes payable to related parties                           $   156,812
   Note payable                                                    14,400
   Consulting fees payable to related parties                     105,992
   Accrued payroll                                                    956
   Accounts payable                                                38,308
                                                              -----------
                Total current liabilities                         316,468
                                                              -----------

COMMITMENTS AND CONTINGENCIES (Notes 1, 6, 7 and 8)

   Preferred stock,  10,000,000 shares  authorized;
    Series A convertible preferred stock, 8%
    cumulative, $4.50 par value, 1,000,000 shares
    designated, 25,356 shares outstanding
    (aggregate liiquidation preference of
    $114,102                                                      114,102

   Common stock, $.001 par value; 20,000,000 shares
    authorized, 8,735,899 shares outstanding                        8,736
   Additional paid-in capital                                   6,867,035
   Accumulated deficit                                         (7,230,268)
                                                              -----------
                Total stockholders' deficit                      (240,395)
                                                              -----------
                Total liabilities and stockholders' deficit   $    76,073
                                                              ===========

           The accompanying notes to consolidated financial statements
            are an integral part of this consolidated balance sheet.

                                       F-2


<PAGE>



                 INMEDICA DEVELOPMENT CORPORATION AND SUBSIDIARY

                      CONSOLIDATED STATEMENTS OF OPERATIONS
                 FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998



                                                1999          1998
                                           -----------    -----------

ROYALTY REVENUES                           $   105,480    $   247,400
                                           -----------    -----------
OPERATING EXPENSES:
   General and administrative                  164,943        251,737
   Research and development                     66,818        224,618
                                           -----------    -----------
                Total operating expenses       231,761        476,355
                                           -----------    -----------
LOSS FROM OPERATIONS                          (126,281)      (228,955)
                                           -----------    -----------
OTHER INCOME (EXPENSE):
   Interest, net                               (13,662)       (11,594)
   Other                                          (471)          (639)
                                           -----------    -----------
                Total other expense, net       (14,133)       (12,233)
                                           -----------    -----------
NET LOSS                                      (140,414)      (241,188)

PREFERRED STOCK DIVIDENDS                       (9,128)        (9,128)
                                           -----------    -----------
NET LOSS APPLICABLE TO
   COMMON STOCKHOLDERS                     $  (149,542)   $  (250,316)
                                           ===========    ===========
NET LOSS PER COMMON SHARE
   (BASIC AND DILUTED)                     $      (.02)   $      (.03)
                                           ===========    ===========
WEIGHTED AVERAGE NUMBER OF COMMON SHARES
   OUTSTANDING (BASIC AND DILUTED)
                                             8,673,535      8,599,350
                                           ===========    ===========



           The accompanying notes to consolidated financial statements
             are an integral part of these consolidated statements.

                                       F-3




<PAGE>



                 INMEDICA DEVELOPMENT CORPORATION AND SUBSIDIARY

                CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT
                 FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998


<TABLE>
<CAPTION>
                                        Series A                                       Additional                      Total
                                     Preferred Stock             Common Stock            Paid-in     Accumulated    Stockholders'
                                  Shares        Amount        Shares      Amount         Capital       Deficit        Deficit
                               -----------   -----------   -----------   -----------   -----------   -----------    -----------
<S>                            <C>           <C>           <C>           <C>           <C>           <C>            <C>
BALANCE, December 31, 1997          25,356   $   114,102     8,550,899   $     8,551   $ 6,732,087   $(6,830,410)   $    24,330

   Common stock issued for
     services                         --            --         110,000           110        48,171          --           48,281

   Common stock options
     granted for services             --            --            --            --          55,582          --           55,582

   Preferred stock dividends          --            --            --            --            --          (9,128)        (9,128)

   Net loss                           --            --            --            --            --        (241,188)      (241,188)
                               -----------   -----------   -----------   -----------   -----------   -----------    -----------

BALANCE, December 31, 1998          25,356       114,102     8,660,899         8,661     6,835,840    (7,080,726)      (122,123)
   Common stock issued for
     services                         --            --          75,000            75        23,370          --           23,445

   Deemed contribution
     related to transfer of
     common stock from
     principal stockholder
     to an employee for
     services                         --            --            --            --           7,825          --            7,825

   Preferred stock dividends          --            --            --            --            --          (9,128)        (9,128)

   Net loss                           --            --            --            --            --        (140,414)      (140,414)
                               -----------   -----------   -----------   -----------   -----------   -----------    -----------

BALANCE, December 31, 1999          25,356   $   114,102     8,735,899   $     8,736   $ 6,867,035   $(7,230,268)   $  (240,395)
                               ===========   ===========   ===========   ===========   ===========   ===========    ===========
</TABLE>

           The accompanying notes to consolidated financial statements
             are an integral part of these consolidated statements.

                                       F-4

<PAGE>





                 INMEDICA DEVELOPMENT CORPORATION AND SUBSIDIARY

                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                 FOR THE YEARS ENDED DECEMBER 31, 1999 AND 1998

                           Increase (Decrease) in Cash
<TABLE>
<CAPTION>

                                                              1999          1998
                                                           ---------    ---------
<S>                                                        <C>          <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
   Net loss                                                $(140,414)   $(241,188)
   Adjustments to reconcile net loss to net cash
     used in operating activities-
         Depreciation and amortization                           865          864
       Compensation on issuance of common stock and
         stock options for services                           31,270      103,863
       Changes in assets and liabilities-
         (Increase) decrease in royalties receivable         (11,200)      21,280
         Decrease in prepaid expenses and other                  736        1,676
         Increase in accounts payable                          9,210       28,067
         Decrease in accrued payroll                            (112)      (5,876)
         Decrease in accrued interest                           --         (4,752)
         Increase in consulting fees payable
           to related party                                   53,996       30,330
                                                           ---------    ---------
                Net cash used in operating activities        (55,649)     (65,736)
                                                           ---------    ---------

CASH FLOWS FROM FINANCING ACTIVITIES:
   Proceeds from borrowings on note payable and notes
     payable to related                                       26,212         --
   Principal payments on note payable to related parties        --        (25,000)
   Preferred stock dividends                                  (9,128)      (9,128)
                                                           ---------    ---------
                Net cash provided by (used in)
                   financing activities                       17,084      (34,128)
                                                           ---------    ---------

NET DECREASE IN CASH                                         (38,565)     (99,864)

CASH AT BEGINNING OF THE YEAR                                 38,565      138,429
                                                           ---------    ---------
CASH AT END OF THE YEAR                                    $    --      $  38,565
                                                           =========    =========

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

   Cash paid during the year for interest                  $  13,884    $  17,657
</TABLE>


           The accompanying notes to consolidated financial statements
             are an integral part of these consolidated statements.

                                       F-5


<PAGE>




                 INMEDICA DEVELOPMENT CORPORATION AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS




1.       NATURE OF OPERATIONS AND SIGNIFICANT ACCOUNTING POLICIES

Nature of Operations

InMedica Development  Corporation  ("InMedica") and its wholly owned subsidiary,
MicroCor,  Inc.  ("MicroCor")  (collectively,  the "Company")  historically have
engaged in the research,  development  and sale of medical  technology  and fund
raising  to support  such  activity.  During  the years 1986 and 1987,  MicroCor
developed  and  marketed  a  portable  electrocardiograph  ("ECG")  monitor  and
manufactured and sold about 450 units. In July 1989,  MicroCor signed a research
and development contract with a predecessor of Johnson and Johnson Medical, Inc.
("Johnson and Johnson"),  for further  development of the ECG  technology.  As a
result of the  agreement,  Johnson and Johnson  now  manufactures  and markets a
product line under the name of Dinamap Plus(TM) which incorporates the Company's
ECG  technology.  Royalties  received from Johnson and Johnson are presently the
Company's  sole  source  of  revenue.  The  Company  has been  advised  that the
royalties from Johnson and Johnson are expected to terminate in 2000.

Since 1989,  the Company has engaged in research and  development of a device to
measure hematocrit  non-invasively (the "Non-Invasive  Hematocrit  Technology").
During  1996,  the  Company  was issued  patent No.  5526808  related to certain
aspects  of its  Non-Invasive  Hematocrit  Technology.  Additionally,  a  patent
application was allowed in November 1996 related to this technology.  Hematocrit
is the percentage of red blood cells in a given volume of blood.  At the present
time, the test for hematocrit is performed  invasively by drawing blood from the
patient and testing the blood sample in the laboratory. Commercialization of the
Non-Invasive Hematocrit Technology is dependent upon favorable testing, Food and
Drug Administration approval, financing of further research and development and,
if warranted, financing of manufacturing and marketing activities.

The Company  generated net losses of $140,414 and $241,188 during 1999 and 1998,
respectively,  and there can be no assurance of profitability in the future.  As
of December 31, 1999,  the Company had an accumulated  deficit of $7,230,268,  a
stockholders'  deficit of $240,395  and  negative  working  capital of $243,297.
These conditions raise substantial doubt as to the Company's ability to continue
as a going  concern.  The Company's  continued  existence is dependent  upon its
ability  to achieve a viable  operating  plan and to obtain  additional  debt or
equity financing.

Management's   operating  plan  includes  continuing  to  search  for  financing
alternatives,  including the formation of strategic alliances or partnerships to
continue  research  and,  if  warranted,  the  manufacture  and sale of products
developed from the Non-Invasive Hematocrit Technology.  However, at present, the
Company has no commitments related to these matters.

                                      F-6
<PAGE>

                 INMEDICA DEVELOPMENT CORPORATION AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Principles of Consolidation

The  consolidated  financial  statements  include the  accounts of InMedica  and
MicroCor.   All  material  intercompany  accounts  and  transactions  have  been
eliminated.

Revenue Recognition

Royalty  revenues are  recognized as sales  information is received from Johnson
and Johnson and cash receipts are assured.

Equipment and Furniture

Equipment  and  furniture  are  recorded  at  cost  and  depreciated  using  the
straight-line  method over the estimated  useful lives of the assets.  The asset
cost and  accumulated  depreciation  for property  retirements and disposals are
eliminated from the respective accounts, and any gain or loss is included in the
determination  of net loss. The costs of major  additions and  improvements  are
capitalized  while the cost of maintenance and repairs are charged to expense as
incurred.

Equipment and furniture consisted of the following at December 31, 1999.

            Equipment                            $       242,260
            Furniture                                     10,729
                                                 ---------------
                                                         252,989
            Less accumulated depreciation               (252,283)
                                                 ---------------
                                                 $           706
                                                 ===============

Depreciation has been computed using the straight-line  method over the three to
five year useful lives of the related assets.

Net Loss Per Common Share

The net loss per  common  share  computation  is based on the  weighted  average
number of shares of common stock outstanding  during each year.  Preferred stock
dividends are deducted from net loss in calculating net loss per common share.

Basic net loss per common share ("Basic EPS") excludes  dilution and is computed
by dividing net loss by the weighted average number of common shares outstanding
during the year.  Diluted net loss per common share ("Diluted EPS") reflects the
potential  dilution  that could  occur if stock  options or other  common  stock
equivalents  were exercised or converted into common stock.  The  computation of
Diluted EPS does not assume exercise or conversion of securities that would have
an antidilutive effect on net loss per common share.

At  December  31,  1999 and 1998,  there were  outstanding  options to  purchase
849,000  shares of common stock,  which were not included in the  computation of
Diluted EPS because they would be anti-dilutive.

                                      F-7

<PAGE>
                 INMEDICA DEVELOPMENT CORPORATION AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

Income Taxes

The Company accounts for income taxes using the liability method. Deferred taxes
are determined based on the estimated future tax effects of differences  between
the financial  reporting and tax reporting bases of assets and liabilities given
the provisions of currently enacted tax laws.

Pervasiveness of Estimates

The preparation of financial  statements in conformity  with generally  accepted
accounting principles requires management to make estimates and assumptions that
affect  the  reported  amounts  of assets  and  liabilities  and  disclosure  of
contingent  assets and  liabilities at the date of the financial  statements and
the  reported  amounts of revenues  and expenses  during the  reporting  period.
Actual results could differ from those estimates.

Fair Value of Financial Instruments

The book value of the Company's financial  instruments  approximates fair value.
The  estimated  fair  values  have  been  determined  using  appropriate  market
information and valuation methodologies.

2.       INCOME TAXES

As of December 31, 1999, deferred income tax assets consisted of the following:

         Net operating loss carryforwards           $   1,006,636
         Future deductible temporary
            differences related to
            compensation, reserves and
            accruals                                      205,317

         Less:  valuation allowance                    (1,211,953)
                                                    -------------
         Net deferred income tax assets             $          -
                                                    =============

At  December  31,  1999,  the  Company  has   consolidated  net  operating  loss
carryforwards   ("NOLs")  for  federal  income  tax  purposes  of  approximately
$2,689,929.  These  NOLs  expire at  various  dates  beginning  in 2005  through
December 31, 2019. An NOL generated in a particular year will expire for federal
tax purposes if not utilized within 20 years. Additionally, the Internal Revenue
Code contains other  provisions which could reduce or limit the availability and
utilization of NOLs. For example,  limitations are imposed on the utilization of
NOLs if  certain  ownership  changes  have  taken  place or will take  place.  A
valuation allowance is provided when it is more likely than not that all or some
portion  of the  deferred  income tax assets  will not be  realized.  Due to the
uncertainty with respect to ultimate realization,  the Company has established a
valuation allowance for all deferred income tax assets.

3.       COMMON STOCK TRANSACTIONS

During 1998, the Company authorized the issuance of 110,000 shares of restricted
common stock to  consultants  and to one  employee for research and  development

                                      F-8

<PAGE>
                 INMEDICA DEVELOPMENT CORPORATION AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


services rendered during 1998. As of December 31, 1999 and 1998, 45,000 of these
shares were issued and the Company was obligated to issue the  remaining  65,000
shares. Accordingly, the 65,000 shares have been reflected as outstanding in the
1999 and 1998  financial  statements  even  though  they will not be  physically
issued  until  2000.  During  1998,  the Company  recognized  $48,281 in expense
related to these shares,  which represented the market price of the stock at the
dates of performance.

During 1999, the Company  authorized the issuance of 75,000 shares of restricted
common  stock to an employee  for  services  rendered.  The  Company  recognized
$23,445 in compensation  expense related to these shares,  which represented the
market value of the stock at the date of grant.

During 1999, a principal stockholder of the Company transferred 25,000 shares of
his  common  stock to an  employee  for  services  rendered.  The  Company,  has
recognized  $7,825 in expense  related to this transfer,  which  represented the
market value of the stock on the date of transfer.

4.       STOCK OPTIONS

With  respect to employees  and  directors,  the Company  accounts for its stock
incentive  plan,  formula stock option plan and certain  options granted outside
the plans under APB Opinion No. 25. Had  compensation  cost for these plans been
determined  consistent with Statement of Financial Accounting Standards ("SFAS")
No. 123,  the  Company's  pro forma net loss and pro forma basic and diluted EPS
would have been as follows:

                                          1999              1998
                                    ----------------- -----------------
      Net loss applicable to
        common stockholders:
             As reported             $    (149,542)     $   (250,316)
             Pro forma                    (136,582)         (250,316)

      Basic and Diluted EPS:
             As reported             $        (.02)     $       (.03)
             Pro forma                        (.02)             (.03)


The Company did not grant  options to employees  during 1999 and 1998.  The 1999
difference between reported and pro forma is due to options forfeited.

Stock Incentive Plan

The Company has in place an incentive  stock  option plan (the "Stock  Incentive
Plan")  for  eligible  directors  and key  employees  of the  Company,  covering
1,350,000  shares of the Company's  common  stock.  Under the terms of the Stock
Incentive  Plan, the options  granted may be either  incentive  stock options as
defined in the Internal Revenue Code or nonqualified  stock options. A committee
composed of  disinterested  members of the Board of Directors  has  authority to
determine,  among other matters,  which eligible key employees and directors are
to receive options, the price at which the nonqualified options will be granted,
the period in which the  options are  exercisable  and the type of options to be
granted. The exercise price for the incentive stock options may not be less than

                                      F-9
<PAGE>
                 INMEDICA DEVELOPMENT CORPORATION AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

100  percent of the fair  market  value of the  common  stock on the date of the
grant. The Stock Incentive Plan contains  antidilution  provisions which provide
for  adjustments to option prices or quantities in the event of certain  changes
in the number of outstanding shares of common stock or the capitalization of the
Company.

Under the stock  incentive  plan at December 31, 1999,  31,500 shares were under
option with exercise prices of $.60 per share and remaining contractual lives of
3.5 years.  There were no options  granted,  exercised,  or forfeited during the
years ended  December 31, 1999 and 1998.  At December 31, 1999,  options for the
purchase of 980,769 shares were available for granting under the Stock Incentive
Plan.

Formula Stock Option Plan

The Company has in place a formula  stock option plan (the  "Formula  Plan") for
eligible  directors of the Company,  covering  100,000 shares of common stock. A
committee of the Board of Directors has the authority to determine,  among other
matters,  the term of the  options and the period  during  which the options are
exercisable.  Under the terms of the Formula Plan,  each member of the committee
which  administers the Stock Incentive Plan is eligible to receive  nonqualified
stock options  pursuant to a formula set forth in the Formula Plan. The exercise
price for options  granted  shall be 30 percent of the fair market  value of the
common stock on the date of the grant.  The Formula Plan  contains  antidilution
provisions  which provide for  adjustments to option prices or quantities in the
event of certain changes in the number of outstanding  shares of common stock or
the capitalization of the Company.

There were no options  granted or  exercised  under the Formula  Plan during the
years ended  December 31, 1999 and 1998.  At December  31,  1999,  there were no
shares  under  option  under the Formula  Plan and  options for the  purchase of
95,500 shares were available for granting.

Other Stock Options

During  1995,  the Company  granted  nonqualified  options  for the  purchase of
1,050,000  shares of common  stock at  prices  ranging  from $.30 to $.39 with a
weighted  average  exercise price of $.32. The options were granted to officers,
directors, employees and consultants to the Company. A total of 500,000 of these
nonqualified  options were issued to the Company's president and chief executive
officer in consideration of collateral provided by him with respect to a Company
bank  loan  described  in  Note  6.  All  options  granted  during  1995  vested
immediately upon granting and are exercisable  through 2005.  During 1996, these
option grants were reduced to 788,500 by resolution of the board of directors of
the Company.  During 1997,  450,000 options were exercised at $.30 per share and
the Company received $135,000.  During 1999, 150,000 options were forfeited.  At
December 31,  1999,  188,500  options  were  outstanding  and  exercisable  with
exercise  prices  ranging from $.30 to $.39,  with a weighted  average  exercise
price of $.33 and a weighted average remaining contractual life of 6.8 years.

During 1996, the Company  granted  nonqualified  options to consultants  for the
purchase of 338,500 shares of common stock at prices ranging from $1.16 to $1.22
per share with a weighted  average exercise price of $1.17. A total of 38,500 of
these nonqualified  options vested immediately upon granting and are exercisable
through  2006.  The  remaining  300,000 of  nonqualified  options were issued in
consideration  for  engineering  work  related  to  the  Company's  Non-Invasive
Hematocrit  Technology and are  exercisable  through 2001. A total of 175,000 of

                                      F-10
<PAGE>
                 INMEDICA DEVELOPMENT CORPORATION AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

the 300,000  originally  granted  options  vested  during 1998 and the remaining
175,000 unvested options were cancelled under the contract due to the consulting
firm not meeting specified deadlines. The weighted average remaining contractual
life of the outstanding 213,500 options is 3.2 years.

During 1997, the Company  granted  nonqualified  options to consultants  and one
employee for the  purchase of a total of 154,000  shares of common stock with an
exercise  price of $.73.  A total  of  100,000  of the  154,000  options  vested
immediately  upon granting and expire in August of 2000.  The  remaining  54,000
options become  exercisable for a period of three years from the completion date
(not later than December 31, 1998) of  satisfactory  clinical  trials related to
the  Company's  Non-Invasive  Hematocrit  Technology.  As of December  31, 1998,
successful clinical trials were not completed,  therefore these options expired.
The remaining options have a weighted average remaining  contractual life of 0.7
years.

During 1998, the Company  entered into an agreement  whereby an existing  option
holder agreed to transfer 37,500 options to another consultant.  The options are
exercisable  through 2000 with an exercise price of $1.22 per share. The Company
recorded $13,125 in expense related to these options.

5.       PREFERRED STOCK

The Company is authorized to issue  10,000,000  shares of preferred  stock.  The
Company's board of directors designated 1,000,000 shares of this preferred stock
as Series A Cumulative Convertible Preferred Stock ("Series A Preferred") with a
par value of $4.50 per share.  Holders of the Series A Preferred  receive annual
cumulative  dividends of eight percent,  payable quarterly,  which dividends are
required to be fully paid or set aside before any other dividend on any class or
series  of stock of the  Company  is paid.  Holders  of the  Series A  Preferred
receive no voting  rights but do receive a  liquidation  preference of $4.50 per
share, plus accrued and unpaid dividends.  Series A Preferred  stockholders have
the right to convert  each share of Series A Preferred to the  Company's  common
stock at $3.00 per common share.

6.       NOTES PAYABLE TO RELATED PARTIES

During 1997,  the Company's  president  paid a $355,000 note payable owed by the
Company to a bank (on which the  president was the  co-obligor)  and the Company
entered  into a line  of  credit  loan  agreement  (the  "Agreement")  with  the
president,  and borrowed an initial  amount  thereunder of $355,000.  Borrowings
under the Agreement  carry terms that are not less favorable than the terms of a
loan that the  president has with a bank which loan was used by the president to
fund the advance  under the  Agreement  to the  Company.  The  president  has an
agreement  with  the  Company  to  lend up to a  maximum  amount  not to  exceed
$175,000. As of December 31, 1999, outstanding principal under the Agreement was
$145,000.  All  outstanding  borrowings  accrue  interest at a bank's prime rate
(8.50  percent at December 31, 1999) plus .25 percent.  The Agreement is secured
by the Company's royalty stream from the Johnson and Johnson agreement (see Note
1).

During 1999,  the Company  entered into note payable  agreements  with two board
members for $7,500 each due in four equal  installments of $1,875 (with interest
at an annual rate of 10 percent)  through  March 31,  2000.  As of December  31,
1999,  outstanding  principal  and accrued  interest  under each  agreement  was
$5,906.  The Company is  currently  unable to make  principal  payments on these
notes, however they continue to accrue interest at the appropriate rate.

                                      F-11

<PAGE>
                 INMEDICA DEVELOPMENT CORPORATION AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

7.       NOTE PAYABLE

During 1999, the Company entered into a note payable agreement with an Insurance
Company.  The  agreement  provides  for the  repayment  of the note in ten equal
installments of $1,890  (including 5 percent interest) from November 12, 1999 to
November 12,  2000.  As of December 31, 1999,  the  outstanding  balance  (which
includes interest) under the note payable was $14,400.

8.       RELATED-PARTY TRANSACTIONS

During  1999 and 1998,  the  Company  incurred  interest  expense of $13,884 and
$12,905, respectively, on the related party notes payable described in Note 6.

The Company has a consulting  arrangement  with an entity owned by the Company's
president  whereby the Company was to pay $4,333 per month during 1998 and 1999.
The  arrangement  can be  terminated by either party at any time. As of December
31, 1999, approximately $94,000 was owed under the arrangement.

                                      F-12

<PAGE>

Item 8.  Disagreements With Accountants on Accounting and Financial Disclosures.
         -----------------------------------------------------------------------

         There have been no  changes in or  disagreements  with  accountants  on
accounting and financial disclosures, as provided in Regulation S-B, Item 304.

                               PART III

Item 9.  Directors,   Executive   Officers,   Promoters  and  Control   Persons;
         -----------------------------------------------------------------------
Compliance with Section 16(a) of the Exchange Act.
--------------------------------------------------

         Directors  and  Executive  Officers of InMedica.  The  following  table
furnishes  information  concerning  the  executive  officers  and  directors  of
InMedica and their business backgrounds for at least the last five years.

     Name                    Age              Director Since
     ----                    ---              --------------
     Larry E. Clark          78                   1995

     Ralph Henson            55                   1999

     Richard Bruggeman       44                   1995

         LARRY E. CLARK - Chairman  of the Board.  Mr.  Clark was  president  of
Clark-Knoll & Associates,  Inc., a Denver,  Colorado management  consulting firm
specializing  in  mergers  and  acquisitions  from  1963 to 1969.  He  served as
president of Petro-Silver, Inc., a small public company based in Salt Lake City,
Utah,  which engaged in the oil and gas business from 1970 to 1975. From 1975 to
1981 Mr. Clark was  president  of Larry Clark &  Associates,  a private  company
which engaged in a corporate  mergers and  acquisitions  business.  In 1981, Mr.
Clark formed  Hingeline-Overthrust Oil & Gas, Inc., a Utah public company, which
merged with Whiting Petroleum Corporation of Denver,  Colorado in December 1983.
Mr.  Clark served as a director of Whiting  Petroleum  from 1983 until 1992 when
Whiting Petroleum merged with IES Industries and Mr. Clark returned to full time
employment as president of Larry Clark & Associates.  Mr. Clark  graduated  from
the U.S.  Merchant  Marine Academy with a BS degree in Naval Science in 1943 and
received a degree in Business  Administration  from the University of Wyoming in
1948.

         RALPH HENSON - Director,  President and Chief  Executive  Officer.  Mr.
Henson was previously employed from 1986 to 1999 as Director of Sales and acting
Director of Clinical Programs of In-line Diagnostics of Farmington, Utah. He was
also  employed  from  1987  to 1994  with  Mallinckrodt  Medical  in  sales  and
marketing,   including   service  as  Export  Sales  and  Marketing  Manger  for
Mallinckrodt  Sensor  Systems  of  Hannef,  Germany.  From  1994  to 1995 he was
national sales manager with HemoCue, Inc. of Mission Viejo, California.


                                       9
<PAGE>


         RICHARD  BRUGGEMAN  -  Director  and   Secretary/Treasurer   and  Chief
Financial Officer of the Company. Since 1993, he has been employed as Controller
of  Kitchen  Specialties,  Inc.,  a Salt  Lake City  firm  distributing  kitchen
appliances in the United States and Canada. From 1986 until 1993 he was employed
by the Company's  subsidiary,  MicroCor,  Inc. as financial manager.  During the
period 1983-1985, he was a sole practitioner in accounting and from 1981-1983 he
was employed by the Salt Lake City public  accounting firm of Robison Hill & Co.
He  graduated  from  the  University  of  Utah  in 1981  with a B.S.  degree  in
accounting.

         Each director  serves until the next annual meeting of  shareholders or
until a successor is elected and  qualified.  Officers  serve at the pleasure of
the board of directors.

         Section  16(a) of the  Securities  Exchange  Act of 1934  requires  the
Company's  directors and executive  officers,  and persons who own more than ten
percent of a registered  class of the Company's  equity  securities to file with
the Securities and Exchange  Commission initial reports of ownership and reports
of changes in ownership of equity securities of the Company. Officers, directors
and greater  than ten percent  shareholders  are required to furnish the Company
with copies of all Section 16(a) forms they file.  To the  Company's  knowledge,
based  solely on  review of the  copies  of any such  reports  furnished  to the
Company, during the fiscal year ended December 31, 1999 all Section 16(a) filing
requirements  applicable  to  officers,  directors  and greater than ten percent
shareholders were complied with.

Item 10.  Executive Compensation.
          -----------------------

         Executive  Compensation.  No  executive  officer  of  the  Company  has
received  compensation  during the three fiscal  years ended  December 31, 1999,
except as disclosed in the table below:
<TABLE>
<CAPTION>

                                                             Annual Compensation
                                                                 Long Term
                                                             Compensation Awards
Name                       Year     Salary     Bonus    Common Stock underlying Options     Other
----                       ----     ------     -----    -------------------------------     -----
<S>                        <C>     <C>           <C>                <C>                    <C>
Ralph Henson      (CEO)    1999    $ 5,833       -                  -                      $31,270#
Larry E. Clark    (CEO)    1999    $   -         -                  -                      $12,000*____
Larry E. Clark    (CEO)    1998    $   -         -                  -                      $51,996*
Larry E. Clark    (CEO)    1997    $   -         -                  -                      $51,996**
</TABLE>

# - Mr. Henson  received  75,000 shares of restricted  stock from the Company in
connection with his employment and an additional  25,000  restricted shares from
Larry Clark. * - consulting  fees accrued for payment to a corporation  owned by
Larry E. Clark.

** -  includes  consulting  fees paid  ($30,331)  and  consulting  fees  accrued
($21,665) for payment to a corporation owned by Larry E. Clark.





                                       10
<PAGE>




         Director Compensation. Directors may be compensated at the rate of $100
for  attendance  at each board  meeting,  but did not receive  compensation  for
meetings in 1999 and 1998.

         Compensation    Committee   Interlocks   and   Insider   Participation.
Compensation  of officers and employees is determined by the Board of Directors.
Mr.  Larry E.  Clark,  chief  executive  officer,  is  chairman  of the Board of
Directors.

         Other  Compensation  Plans.  On December 6, 1991, the Company adopted a
stock  incentive  plan (the "Stock  Incentive  Plan") and a formula stock option
plan (the "Formula Plan"). On May 30, 1992, at the annual  shareholder  meeting,
the shareholders approved the Stock Incentive Plan and the Formula Plan.

         The Stock  Incentive  Plan  covers  1,350,000  shares of the  Company's
common stock.  Under the terms of the plan, the options  granted to eligible key
employees and directors,  shall be either  incentive stock options as defined in
Section 422 of the Internal  Revenue Code of 1986, as amended,  or non-qualified
stock options.  A committee  composed of  disinterested  members of the Board of
Directors has authority to determine,  among other  matters,  which eligible key
employees  and  directors  are to  receive  options,  the  price  at  which  the
non-qualified  options  will be  granted,  the period in which the  options  are
exercisable  and  the  type of  options  granted.  The  exercise  price  for the
incentive  stock  options  shall not be less than 100 percent of the fair market
value of the common stock on the date of the grant.

         The Formula Plan covers 100,000 shares of common stock. Under the terms
of the plan each member of the committee  which  administers the Stock Incentive
Plan is eligible to receive  non-qualified  stock options  pursuant to a formula
set forth in the  plan.  The  exercise  price for  options  granted  shall be 30
percent of the fair market value of the common stock on the date of the grant. A
committee of the Board of Directors has the authority to determine,  among other
matters,  the term of  options  and the  period  during  which the  options  are
exercisable.

         The following tables show certain  information  regarding stock options
granted to and exercised by officers named in the executive compensation table:

                       OPTIONS GRANTED IN THE LAST FISCAL YEAR

                                      % of Total
                                      Options
                                      Granted to    Exercise
                        Options       Employees in  Price        Expiration
       Name             Granted       FY 1999       ($/Share)    Date
       ----             -------       ------------  ---------    ----
       None




                                       11
<PAGE>




                  AGGREGATED OPTIONS EXERCISED IN LAST
               FISCAL YEAR AND FISCAL YEAR-END OPTION VALUES

                                                         Value of Unexercissed
                                     Number of           In-The-Money
                                     Unexercised Options Options at Fiscal
         Shares                      at Fiscal Year End  Year End
         Acquired on   Value         Exercisable/        Exercisable/
Name     Exercise (#)  Realized ($)  Unexercisable       Unexercisable

None

         The  Company  presently  has no plan for the  payment of any annuity or
pension  retirement  benefits to any of its officers or directors,  and no other
remuneration payments,  contingent or otherwise,  are proposed to be paid in the
future to any officer or director, directly or indirectly.




                                       12
<PAGE>




Item 11. Security  Ownership of Certain  Beneficial  Owners and Management.
         ------------------------------------------------------------------

         The following table furnishes  information  concerning the common stock
ownership of directors,  officers,  and principal  shareholders  as of March 20,
2000:

                             Nature of      Number of
   Name and Position         Ownership   Shares Owned    Percent

   Larry E. Clark            Direct         1,528,000     17.5%

   Allan L. Kaminsky         Direct           798,875      9.1%
   4602 S. Fortuna Way
   S.L.C., Utah 84124
   Principal Shareholder

   Paul J. Diehl             Direct and      719,230(2)    8.2%
   2963 E. Fallentine Rd.    Indirect
   Sandy, Utah   84092
   Principal Shareholder

   J. Lynn Smith             Direct and      452,048(3)    5.2%
   5770 S. 250 East #115     Indirect
   Murray, Utah 84107-8100
   Principal Shareholder

   Ralph Henson              Direct           100,000      1.1%
   President, Director
   Chief Executive Officer

   Richard Bruggeman         Direct and      174,387(4)    2.0%
   Director, Chief           Indirect
   Financial Officer         Options          106,500      1.2%
                                            ---------
                             Total            280,887      3.2%
                                            =========
   All Executive Officers    Direct and     1,802,387     20.6%
   and Directors as a        Indirect
   group (3 persons)         Options          106,500      1.2%
                                            ---------     -----
                             Total          1,908,887     21.6%
                                            =========

         (2) -  Includes  639,599  shares  held by the Paul J.  Diehl,  M.D.P.C.
profit  sharing  plan,  one share held by Paul J. Diehl,  P.C. and 79,630 shares
held by Dr. Diehl as custodian for his wife's daughter, Shanon.

         (3) - Includes  186,048  shares held  directly by Dr. Smith and 266,000
shares held by the J.Lynn Smith Family Limited Partnership.

         (4) - Includes 400 shares held in  individual  retirement  accounts and
4,620 shares held in a family trust of which Mr. Bruggeman is Trustee.


                                       13
<PAGE>




Shares shown in the forgoing table as directly owned are owned  beneficially and
of  record,  and such  record  shareholder  has  sole  voting,  investment,  and
dispositive  power.  Calculations  of the  percentage  of  ownership  of  shares
outstanding in the foregoing table assumes the exercise of options, to which the
percentage  relates.  Percentages  calculated  for totals assume the exercise of
options comprising such totals.

Item 12. Certain Relationships and Related Transactions.
         ----------------------------------------------

         The Company  owes  $145,000 to its Chief  Executive  Officer,  Larry E.
Clark,  for loans made by Mr. Clark in prior years. The Company pays interest at
the prime rate plus .25%.  During 1999,  interest payments to Mr. Clark totalled
$13,884.  Repayment  of the loan is  secured  by an  assignment  of the  royalty
contract with Johnson & Johnson  Medical,  Inc. See also Note 6 to the Financial
Statements.

Item 13. Exhibits and Reports on Form 8-K.
         --------------------------------

(a) Exhibits

Exhibit No.   S-K No.               Description

               (3)                  Articles   of   Incorporation   and   Bylaws
                                    incorporated by reference to the exhibits to
                                    Form 10-K for the year  ended  December  31,
                                    1983

               (3)                  Articles  of  Amendment  to the  Articles of
                                    Incorporation  of the Company  changing  the
                                    Company's  name  to  "InMedica   Development
                                    Corporation"  incorporated  by  reference to
                                    Exhibit  1 to Form  10-K for the year  ended
                                    December 31, 1984

               (4)                  Articles of  Amendment,  dated June 16, 1995
                                    to  the  Articles  of  Incorporation  of the
                                    Company adopting a class of Preferred Stock,
                                    incorporated  by  reference  to Exhibit 1 to
                                    Form 10-QSB for the period  ended  September
                                    30, 1995

               (4)                  Articles of Amendment,  dated  September 25,
                                    1995 to the Articles of Incorporation of the
                                    Company adopting a Series A Preferred Stock,
                                    incorporated  by  reference  to Exhibit 2 to
                                    Form 10-QSB for the period  ended  September
                                    30, 1995




                                       14
<PAGE>




              (10)                  Agreement between MicroCor, Inc. and Johnson
                                    & Johnson Medical, Inc. dated June 15, 1995,
                                    incorporated  by reference to Form 8-K dated
                                    June 30, 1995

              (10)                  Agreement  dated  September  3, 1996 between
                                    InMedica  Development  Corporation  and Paul
                                    Ruben  dba  Ruben   Engineering  and  Calvin
                                    Ruben,  incorporated  by  reference  to  the
                                    Exhibits  to Form 8-K  dated  September  20,
                                    1996.

              (10)                  Loan  Agreement  between  Larry E. Clark and
                                    the InMedica  Development  Corporation dated
                                    June 23, 1997,  incorporated by reference to
                                    Exhibits of Form 10QSB for the Quarter ended
                                    June 30, 1997.

              (10)                  Hematocrit  Development and Option Agreement
                                    between InMedica Development Corporation and
                                    Medical  Physics,   dated  August  29,  1997
                                    incorporated  by  reference  to  Exhibits of
                                    Form 10QSB for the Quarter  ended  September
                                    30, 1997.

              (10)                  First    Amendment    to   the    Hematocrit
                                    Development  and  Option  Agreement  between
                                    InMedica Development Corporation and Medical
                                    Physics, dated March 1, 1998.

              (10)                  Agreement    among   InMedica    Development
                                    Corporation,  David  Wheeler,  Nevada Cancer
                                    Center and Chris  Bringhurst dated April 16,
                                    1998,  incorporated by reference to Exhibits
                                    of Form 10QSB for the  Quarter  ended  March
                                    31, 1998.

                                       15
<PAGE>

              (10)                  Employment   Agreement,   effective   as  of
                                    December 1, 1999  between  Ralph  Henson and
                                    the  Registrant  and  Investment  letter  of
                                    Ralph Henson,  incorporated  by reference to
                                    the 8-K of the Registrant  dated December 1,
                                    1999.

              (11)                  Statement regarding Computation of Per Share
                                    Loss   (see   Consolidated   Statements   of
                                    Operations  for the years ended December 31,
                                    1997 and 1996

              (21)                  Subsidiaries of the Company (MicroCor, Inc.,
                                    a Utah corporation)

   1          (27)                  Financial Data Schedule

(b) A report on Form 8-K was filed  during the fourth  quarter of the year ended
December 31, 1999.

                                    EXHIBITS

Exhibits  filed with the Form 10-KSB of InMedica  Development  Corporation,  SEC
File No. 0-12968, for the year ended 12/31/98:

Exhibit No.      SB Item No.       Description
-----------      -----------       -----------
   1                (27)           Financial Data Schedule



                                       16
<PAGE>





                                   SIGNATURES

         In  accordance  with  Section  13 or 15(d)  of the  Exchange  Act,  the
Registrant  caused  this  report to be signed on its behalf by the  undersigned,
thereunto duly authorized.

                                   INMEDICA DEVELOPMENT CORPORATION



                                   By /s/ Ralph Henson
                                      ----------------
                                      RALPH HENSON, President
                                      Chief Executive Officer

                                      /s/ Richard Bruggeman
                                      ---------------------
                                      RICHARD BRUGGEMAN,
Date: March 28 ,2000                  Chief Financial Officer
      --------------


                                       17
<PAGE>

         In accordance  with the Exchange Act, this report has been signed below
by the following  persons on behalf of the  Registrant and in the capacities and
on the dates indicated.

                                      /s/ Larry E. Clark
                                      ------------------
 March 28, 2000                       LARRY E. CLARK
 --------------                       Director


                                      /s/ Richard Bruggeman
                                      ---------------------
 March 28, 1999                       RICHARD BRUGGEMAN
 --------------                       Director


                                      /s/ Ralph Henson
                                      ----------------
 March  , 2000                        RALPH HENSON
--------------                        Director